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H.B. 240 Enrolled





Sponsor: Ron Bigelow

                  LONG TITLE
                  General Description:
                      This bill establishes a disaster loan program.
                  Highlighted Provisions:
                      This bill:
                      .    authorizes the Division of Emergency Services and Homeland Security to make
                  loans to counties that are affected by disasters;
                      .    establishes loan requirements; and
                      .    establishes a mechanism for requesting the loan and for other political subdivisions
                  within the county to participate in the loan program.
                  Monies Appropriated in this Bill:
                      This bill appropriates $25,000,000 from the General Fund to the Division of Emergency
                  Services and Homeland Security for fiscal year 2004-05 only, to fund the loan program.
                  Other Special Clauses:
                      This bill provides an immediate effective date.
                  Utah Code Sections Affected:
                      53-2-102.5, Utah Code Annotated 1953
                  Be it enacted by the Legislature of the state of Utah:
                      Section 1. Section 53-2-102.5 is enacted to read:
                      53-2-102.5. Loan program for disasters.
                      (1) The director may make loans to local governments as provided in this section

                      (a) the governor has issued a proclamation declaring a state of emergency because of a
                  natural disaster;
                      (b) the Legislature has appropriated monies to the division explicitly for that purpose;
                      (c) threats to the public health and safety, or damages to flood control systems or the
                  transportation infrastructure exist.
                      (2) (a) In order to qualify for loans under this section, the county and each political
                  subdivision within the county shall:
                      (i) pass a resolution that:
                      (A) requests a loan;
                      (B) identifies the loan amount that is requested; and
                      (C) describes, in as much detail as possible, how the entity will spend the loan proceeds;
                      (ii) complete the application for funds provided by the director.
                      (b) Each political subdivision other than the county shall submit a copy of its resolution
                  and application to the county legislative body.
                      (c) The county legislative body shall file with the director:
                      (i) a letter identifying the total loan amount sought by the county and its political
                  subdivisions; and
                      (ii) a copy of the county's resolution and application and a copy of the resolution and
                  application of each political subdivision seeking loan funds.
                      (3) (a) To the extent appropriated funds are available, the director shall prepare a
                  promissory note lending the county the total amount requested by the county for itself and its
                  political subdivisions.
                      (b) The director shall ensure that the promissory note contains:
                      (i) an annual percentage rate of 2%;
                      (ii) a requirement that the principal and interest on the note are due on the May 1 in the
                  calendar year after the year in which the note is signed;

                      (iii) terms allowing the county to prepay some or all of the note's principal, interest, or
                  both before the date that the note is due;
                      (iv) terms that require repayment of the principal and interest on the note be made to the
                  General Fund Budget Reserve Account established in Section 63-38-2.5 ; and
                      (v) terms that limit the use of note proceeds to the repair and reconstruction of
                  infrastructures owned by local governments located within the county.
                      (c) After an authorized representative of the county signs the promissory note, the
                  director shall disburse the loan funds to the county.
                      (4) The county and any participating political subdivision may not use loan proceeds for
                      (a) that could have been paid from other available funding sources if the county or
                  participating political subdivision had applied for those funds; or
                      (b) to compensate private businesses or private persons for damages incurred in the
                  disaster by those private businesses or persons.
                      (5) After receiving the loan proceeds from the state, the county shall, before disbursing
                  loan proceeds to the other county political subdivisions, obtain signed promissory notes from
                  each participating political subdivision that include terms substantially similar to the terms
                  contained in the promissory note signed by the county.
                      (6) The county shall, on behalf of itself and any participating political subdivision, file a
                  report with the director every three months, that:
                      (a) specifies each project on which loan funds were expended, classified by the name of
                  the local entity that expended the funds; and
                      (b) identifies the amount expended for that project.
                      (7) If the county or one of its participating political subdivisions has not expended or
                  committed the funds by the date that the promissory note is due, the county or participating
                  political subdivision shall return the unused or uncommitted funds to the director for redeposit
                  into the fund.
                      Section 2. Appropriation.

                      (1) There is appropriated $25,000,000 from the General Fund, for fiscal year 2004-05
                  only, to the Division of Emergency Services and Homeland Security for the loan program created
                  by Section 53-2-102.5 .
                      (2) It is the intent of the Legislature that, because of the flooding of the Virgin and Santa
                  Clara rivers in January of 2005, these monies be used for loans to the affected Washington
                  County entities in order to:
                      (a) preserve the public health and safety;
                      (b) reestablish the tourism industry;
                      (c) repair and stabilize flood control and management systems and facilities;
                      (d) repair and rebuild the damaged transportation infrastructure; and
                      (e) ensure that the state complies with national and state environmental standards.
                      (3) It is the intent of the Legislature that this $25,000,000 appropriation is nonlapsing.
                      Section 3. Effective date.
                      If approved by two-thirds of all the members elected to each house, this bill takes effect
                  upon approval by the governor, or the day following the constitutional time limit of Utah
                  Constitution Article VII, Section 8, without the governor's signature, or in the case of a veto, the
                  date of veto override.

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